Sycamore-Backed Preschool Chain to Sell its First Asset-Backeds

Goddard Systems, a franchiser of US preschools, is essentially mortgaging its business soon after being purchased by Sycamore Partners, a private equity firm.

The company is selling $392 million of bonds backed by effectively all of its assets, including franchise agreements, royalties and fees, and intellectual property, according to a report from ratings firm Kroll Bond Rating Agency. The securities are preliminarily expected to be rated BBB-, the lowest investment-grade rating, according to KBRA.

The proceeds of Goddard 2022-1 will be used for purposes including refinancing existing credit facilities, according to KBRA analysts led by Xilun Chen. ...